Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Bank of Japan pumps $180 billion into banks

By Chris Isidore, senior writer, and Aaron Smith, staff writer

NEW YORK (CNNMoney) -- Japanese officials said Monday they will backstop the country's financial system with a cash injection of more than $180 billion to buffer it against the impact of last week's devastating earthquake and tsunami.

The Bank of Japan doubled the size of its existing asset-purchase program to ¥10 trillion from ¥5 trillion. In addition it pumped an additional ¥10 trillion into the economy through a record "funds-supplying" operation, bringing the total new cash to ¥15 trillion, or about $183 billion.

Japanese officials said that the increase in asset purchases is for "preempting a deterioration in business sentiment and an increase in risk aversion in financial markets from adversely affecting economic activity."

The central bank is purchasing a mix of assets, including Japanese government bonds, Treasury discount bills and corporate bonds.

"The Bank will do its utmost to continue ensuring stability in the financial markets and securing smooth settlement of funds, including providing liquidity," said the bank, in a press release.

The aim is to make sure the banks have enough cash on hand to meet demands of panicky investors and cover withdrawal demands of bank customers.

Officials will rigidly monitor the markets to prevent any transactions by people trying take advantage of the disaster, Japanese Minister for Financial Services Shozaburo Jimi said Sunday. Specifically, the ministry will ban so-called naked short selling, which can cause a run on stocks.

The earthquake hit off the coast of Japan, several hundred miles from Tokyo, just before the close of trading in Japanese markets on Friday afternoon. The benchmark Nikkei 225 stock index closed down 6% on Monday.

Friday's earthquake -- the most powerful to hit Japan in at least 100 years -- unleashed walls of water that caused widespread damage. By official counts, 1,833 people have died and thousands are missing. Fears remain that the toll could go much higher. To top of page

Overnight Avg Rate Latest Change Last Week
30 yr fixed3.50%3.47%
15 yr fixed2.74%2.71%
5/1 ARM3.26%3.00%
30 yr refi3.53%3.50%
15 yr refi2.76%2.73%
Rate data provided
by Bankrate.com
View rates in your area
Find personalized rates:
Index Last Change % Change
Dow 18,169.27 -53.76 -0.30%
Nasdaq 5,283.40 -26.43 -0.50%
S&P 500 2,143.16 -8.17 -0.38%
Treasuries 1.76 -0.01 -0.28%
Data as of 7:21pm ET
Company Price Change % Change
Chesapeake Energy Co... 6.11 -0.25 -3.93%
Under Armour Inc 32.89 -5.01 -13.22%
Freeport-McMoRan Inc... 10.55 0.37 3.63%
Bank of America Corp... 16.72 -0.05 -0.30%
Apple Inc 118.25 0.60 0.51%
Data as of 4:15pm ET


Donald Trump has repeatedly said he pays "tremendous" amounts in taxes, but when it comes to his properties, he fights to pay as little tax as possible. And that often comes with a cost to the towns or cities where Trump owns property. More

Food shortages, recession, skyrocketing inflation and a plummeting currency are just a few issues causing Venezuela to dive deeper into crisis. More

Apple's sales declined for the third consecutive quarter, but the company expects to grow again next quarter. More

People flying on Delta can now use the company's app to see where their luggage is in its journey to its final destination. More